Several U.S. institutional investors said they are closely monitoring the developments at Pimco, the world's largest bond firm, in the wake of Mohamed El-Erian's abrupt resignation as CEO and ensuing acrimony between him and co-founder Bill Gross.US District Judge Jeffrey White in San Francisco issued a nationwide decree prohibiting the NSA from destroying the records until March 19, when another hearing will be held to further extend the deadline. The court order overrides an earlier ruling by the Foreign Intelligence Surveillance Court in Washington to destroy the records. Governor Mark Carney told MPs on the Treasury Committee that it would create a new deputy governor position with responsibility for markets and banking.
The investors, including retirement systems, have formally put Pimco on "watch lists," a signal that they will keep a much closer eye its performance than usual. It could eventually lead to reductions in the amount of money they allocate to funds at the firm, whose full name is Pacific Investment Management Co. and which has $1.91 trillion in assets.
"We intend to go out and meet with them over the course of the next month," said David Hunter, chief investment officer of the North Dakota State Investment Board. The board, which has about $400 million invested with Pimco, put the fund on its watch list on Feb. 28.
This news item showed up on the moneynews.com Internet site very early yesterday morning EDT---and today's first story is courtesy of West Virginia reader Elliot Simon.
The labor force participation rate in 2013 for Americans in their twenties hit the lowest level recorded since 1981, when the Bureau of Labor Statistics started releasing employment data on people in the full age bracket of 20 through 29.
The labor force participation rate for people ages 20 through 24—which BLS has been tracking since 1948—hit a 42-year low in 2013.
Since 2008, the last year before President Barack Obama took office, the number of Americans in their twenties who were not in the labor force during the average month has climbed from 8,756,000 to 10,511,000—an increase of 1,755,000 or 20 percent.
This story appeared on the cnsnews.com Internet site late yesterday morning EDT---and I thank reader "Howard" for sending it our way.
Think JPM's zero trading day losses in 2013 was impressive? Prepare to have your mind blown. The chart below shows the chart of daily net trading income by High Frequency Trading titan Virtu, taken from its just filed IPO prospectus. The punchline: in 4 years of trading Virtu has had one, one, day in which it lost money.
From the S-1: "The chart below illustrates our daily Adjusted Net Trading Income from January 1, 2009 through December 31, 2013. As a result of our real-time risk management strategy and technology, we had only one losing trading day during the period depicted, a total of 1,238 trading days. "
How is this statistical anomaly possible? For those who have been following our narrative on the market-manipulating, endless crime that is HFT will know all too well. When you have a "strategy" whose only mission is to front run order flow, and scalp pennies from every market order. It also explains why fundamentals haven't mattered in years - the only thing that does matter is to quickly open one's own HFT stop, front run as much order flow as possible, and scalp pennies ahead of the bid and ask... billions and billions of times, leading to the statistically improbable chart pictured above.
This must read Zero Hedge piece from Monday evening EDT, arrived in my in-box in the wee hours of yesterday morning. But because I was already full up with stories in Tuesday's column, it had to wait until today. My thanks go out to reader Harry Grant for sharing it with us.
In what has been described as a victory for privacy advocates, a federal judge halted the destruction Monday of millions of data records collected by the National Security Agency more than five years ago.
U.S. District Judge Jeffrey White in San Francisco issued a nationwide decree prohibiting the NSA from destroying the records until March 19, when another hearing will be held to further extend the deadline. The court order overrides an earlier ruling by the Foreign Intelligence Surveillance Court in Washington to destroy the records.
The NSA is prohibited from destroying “any telephone metadata or ‘call detail’ records,” White said.
This article was posted on the Russia Today website yesterday morning Moscow time---and it's the first offering of the day from Roy Stephens.
The Bank of England will tighten its governance after criticism of its response to claims of manipulation of foreign exchange (forex) rates.
He said the person would carry out "a root and branch review" of how the Bank conducts market intelligence.
It comes amid claims that some bank officials knew of alleged forex fixing.
It has been claimed that currency traders colluded via online chat rooms and instant messaging to manipulate forex rates.
This article was posted on the bbc.co.uk Internet site early yesterday afternoon EDT---and it's the first offering of the day from Manitoba reader Ulrike Marx.
Britain has just carried out one of the greatest victimless crimes in modern financial history. It is in effect wiping out public debt worth 20pc to 25pc of GDP – on the sly – without inflicting serious macroeconomic damage or frightening global bond markets.
Governor Mark Carney more or less acknowledged this morning that the Bank of England will never reverse its £375bn of Gilts purchases. Quite right too.
“Any unwinding of QE should come after several adjustments to rates,” he told the Treasury Select Committee. The word “any” tells us what we need to know.
This follows comments by Deputy Governor Charlie Bean yesterday that the Bank will “only contemplate selling back Gilts once the recovery is on a firm path.” He admitted that some holdings may never be sold.
This Ambrose Evans-Pritchard blog was posted on The Telegraph's website sometime yesterday---and it's another story that's courtesy of Roy Stephens.
The European Central Bank said it will look for capital shortfalls in euro-area banks by examining more than 3.72 trillion euros ($5.16 trillion) in assets in on-site checks.
Releasing a 285-page manual for staff undertaking the Asset Quality Review, the Frankfurt-based ECB said any adjustments to lenders’ capital ratios identified as necessary by the unprecedented balance-sheet probe will be determined during July. While banks won’t have to revise their 2013 accounts, they may have to raise extra capital once the results are published in October following a stress test.
Staff from the ECB, national supervisors and auditing firms will in coming months divide the health check into 10 work areas to examine assets from shipping loans to commercial real estate, comprising about 160,000 individual credit files. The review, which covers 58 percent of the risk-weighted assets held by the 128 banks in the exercise, is part of the ECB’s preparations to take over supervision of the region’s biggest lenders in November in the first pillar of a nascent banking union.
This Bloomberg story, filed from Frankfurt, was posted on their website in the wee hours of Tuesday morning Denver time---and my thanks go out to Ulrike Marx for her second contribution to today's column.
1. Crimea parliament declares independence from Ukraine ahead of referendum: Russia Today 2. Ukraine parliament delivers ultimatum to Crimea over referendum: The Guardian 3. Two big pipeline projects on hold, as EU-Russia relations sour over Ukraine: Russia Today 4. U.S. abandoned international law, abides by ‘law of the jungle’ in Ukraine: Russia Today
[The above stories are courtesy of Bob Visser and Roy Stephens]
Baoding Tianwei Baobian Electric Co. bonds and stock were suspended from trading today after the Chinese electrical equipment maker said it reported losses for a second year running.
The company, which also makes solar panels and is based in the northeast province of Hebei, reported a net loss of 5.23 billion yuan ($852 million) in 2013 versus a 1.55 billion yuan earnings deficit a year ago, according to a statement to the Shanghai stock exchange yesterday. The exchange, in line with its rules, will decide in seven trading days whether to continue the trading halt on Tianwei Baobian Electric’s bonds until its losses are reversed.
Investor scrutiny of China’s onshore bond market is mounting after Shanghai Chaori Solar Energy Science & Technology Co. last week became the first company to default. Chaori Solar’s failure to pay has stoked speculation more companies may miss debt deadlines also.
The yield on Tianwei Baobian Electric’s 1.6 billion yuan of 5.75 percent bonds due 2018 has soared 537 basis points over the past year to 11.13 percent as of yesterday, according to exchange data. Its stock has fallen 37 percent.
Another potential Chinese bond default??? This short story, filed from Shanghai, was posted on the businessweek.com Internet site yesterday sometime---and I thank Casey Research's Marin Katusa for sending it around yesterday.
Growing numbers of Chinese are using the country's state-backed bankcards to illegally spirit billions of dollars abroad, a Reuters examination has found.
This underground money is flowing across the border into the gambling hub of Macau, a former Portuguese colony that like Hong Kong is an autonomous region of China. And the conduit for the cash is the Chinese government-supported payment card network, China UnionPay.
In a warren of gritty streets around Macau's ritzy casino resorts, hundreds of neon-lit jewellery, watch and pawn shops are doing a brisk business giving mainland Chinese customers cash by allowing them to use UnionPay cards to make fake purchases - a way of evading China's strict currency-export controls.
This longish but interesting Reuters story, filed from Macau, was posted on their website late last night EDT---and it's another contribution from Ulrike Marx.
A slew of shockingly weak data from China and Japan has led to a sharp sell-off in Asian stock markets and the biggest one-day crash in iron ore prices since the Lehman crisis, calling into question the strength of the global recovery.
The Shanghai Composite index of stocks fell below the key level of 2,000 after investors reacted with shock to an 18pc slump in Chinese exports in February and to signs that credit is wilting again. Iron ore fell 8.3pc.
Fresh loans in China’s shadow banking system evaporated to almost nothing from $160bn in January, suggesting the clampdown on the $8 trillion sector is biting hard.
This commentary by Ambrose Evans-Pritchard was posted on the telegraph.co.uk Internet site early Monday evening GMT---and I thank Roy Stephens for sending it our way.
1. James Turk: "Loss of Faith, Mismanaged Currency and a Flight to Gold" 2. Art Cashin: "Things Are Now Heating Up Fast in Ukraine" 3. Dr. Stephen Leeb: "$10,000 Gold, Russia, China, the United States and Ukraine" 4. Ronald-Peter Stoferle: "4 Astonishing Charts Reveal the World is Going Exponential"
[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests, to them, and not to me. Thank you. - Ed]
A U.S. investment-management firm has filed a lawsuit against the five banks that set the London benchmark gold price, alleging that the banks conspired to manipulate the price of gold for their own gain.
Documents seen by The Wall Street Journal show that AIS Capital Management, based in Connecticut, filed a class-action complaint late Monday against Barclays PLC, Deutsche Bank, HSBC Holdings PLC, Bank of Nova Scotia and Société Générale SA in the U.S. district court for the Southern District of New York.
The suit is on behalf of AIS and other investors who held or traded gold and gold derivatives that were settled based on the gold fix, or who held or traded COMEX gold futures or options, from 2004 to present.
This marketwatch.com story was posted on their website early yesterday morning EDT---and I found it in a GATA release yesterday.
GoldMoney research director Alasdair Macleod last week made a presentation to the Brazilian Chamber of Commerce in London about trends in the gold market, covering the long history of central bank intervention, the evidence that Western central bank gold has run out, and Asia's recent acquisition of huge volumes of gold on the eve of the likely bursting of the currency bubble.
Macleod's presentation runs for 21:27 minutes---and was posted on the youtube.com Internet site on Monday sometime. It's another item I found over at the gata.org Internet site yesterday.
The biggest growth in trading activity of gold future contracts in the last five years has come from China, according to the latest information from the Futures Industry Association.
Monday evening the FIA released its annual report on global trends in the trading of futures and options; Gold futures on the Shanghai Futures Exchange saw the biggest increase volume in the last five years as 20.09 million contracts were traded in 2013, an increase of 416% from the 3.9 million contracts traded in 2008.
As a comparison, in North American, Comex gold options traded on the New York Mercantile Exchange came in sixth place in volume growth over the last five years with 10.69 million contracts traded in 2013, an increase of 141% from 2008 when there were 4.39 million contracts.
“China’s commodity futures markets have been growing extremely rapidly in recent years, but 2013 stands out for the large number of new contracts that entered the markets,” the report said.
This news item was posted on the Kitco website on Monday---and I thank Ulrike Marx for sending it along.
FBI and U.S. Treasury agents have arrived in Kiev to aid Ukraine's interim leaders to uncover the financial crimes of the government of ousted President Viktor Yanukovych in an effort to repatriate billions of dollars.
Ukraine's new government is determined to recover some of the billions of dollars it says went missing during Yanukovych's regime.
And Washington is eager to assist.
"We are very interested in working with the government to support its investigations of those financial crimes, and we have already, on the ground here in Ukraine, experts from the FBI, the Department of Justice, and the Department of Treasury who are working with their Ukrainian counterparts to support the Ukrainian investigation," U.S. Ambassador to Ukraine Geoffrey Pyatt told reporters here on Monday.
According to Ukrainian officials more than $20 billion of gold reserves may have been embezzled and $37 billion in loans has disappeared. In the past three years more than $70 billion was moved to offshore accounts from Ukraine's financial system.
This must read piece was posted on the voanews.com Internet site on Monday---and it's another article I found on the gata.org Internet site yesterday.
The Federal Reserve Bank of New York today responded to GATA's inquiry last night, prompted by reports from Ukraine as to whether it was taking custody of Ukraine's gold reserves.
A spokesman for the New York Fed said simply: "Any inquiry regarding gold accounts should be directed to the account holder. You may want to contact the National Bank of Ukraine to discuss this report."
GATA's similar inquiry of last night to the U.S. State Department has not yet prompted any reply.
This short commentary by GATA's secretary/treasurer Chris Powell was posted on their website yesterday---and is worth your time.
“I believed throughout 2013, with the price of gold coming down, the fundamentals were only getting better,” he answered. “During that time, the Chinese bought like mad and the Fed printed another trillion dollars through QE. Nonetheless, heavy selling took the gold price down.
“Today, the difference is that the sellers are exhausted, and physical demand is catching up. One of the numbers we are looking at is the quantity of registered inventories on the COMEX for gold. That’s the amount of physical gold that is available when someone asks for physical delivery instead of a cash settlement.”
“One day, we might see someone try to break the market on the physical side, by demanding delivery of more tons than can be supplied – hence driving the price up.
“Because of this threat, I would tell investors in the metals to stick to ‘fully-allocated’ products, where you have a claim to a specific amount of metal that is physically held in a vault, not lent out or hypothecated.”
This commentary by Charles was posted on the sprottglobal.com Internet site yesterday---and is worth reading.
First Majestic Silver Corp. ("First Majestic" or the "Company") announced [on Monday] that its board of directors has approved the extension of its share repurchase program (the "Share Repurchase") pursuant to a normal course issuer bid in the open market through the facilities of the Toronto Stock Exchange ("TSX") or alternative Canadian market places over the next 12 months. Pursuant to the Share Repurchase, the Company proposes to repurchase up to 5,865,931 common shares of the Company which represents 5% of the 117,318,624 issued and outstanding shares of the Company as of March 4, 2014.
In order to implement the Share Repurchase, First Majestic has received TSX approval of its notice of intention to make a normal course issuer bid. The notice provides that First Majestic may, during the 12 month period commencing on March 13, 2014 and ending on or before March 12, 2015, purchase up to 5,865,931 common shares through the facilities of the TSX and alternative Canadian marketplaces.
In accordance with TSX rules, daily purchases made by First Majestic on the TSX will not exceed 116,903 common shares, or 25% of First Majestic's average daily trading volume of 467,612 common shares on the TSX for the six calendar months preceding the date of the acceptance of the original notice, subject to certain prescribed exemptions.
The Company repurchased a total of 215,000 shares for cancellation under its prior normal course issuer bid which commenced on March 13, 2013 and expires on March 12, 2014, at a volume weighted average price of $11.385 per common share. All repurchases were made by means of open-market transactions through the facilities of the TSX.
As a long-time shareholder in this company, I was sort of happy to see this announcement---but on the other hand it's an admission by the firm that it will not raise a finger in protest against the JPMorgan-centric price management scheme that has been ongoing since it because obvious in August 2008---even though the management of the company is fully aware that the price of the metal they mine is far below its free-market price because of that. The major silver producers have decided to circle the wagons against their own stockholders on this issue---and the share repurchase program is this firm's attempt to make amends. How did it come to this?
The platinum wage negotiations currently rocking the big three producers (Anglo American Platinum, Impala Platinum, Lonmin) in Rustenburg have taken a turn for the worse as they are now mired in a mudslinging fight between the chamber of mines negotiating on behalf of the companies and the Commission for Conciliation Mediation and Arbitration.
The spat between the Chamber of Mines and the CCMA stems from a report that quoted the chamber’s chief negotiator saying that the CCMA caused the breakdown in talks between AMCU and the platinum mining companies.
During the interview, which the Chamber claims was off-the-record, Strydom lambasted the CCMA negotiators for not having knowledge of mining or economics, and also questioned the logic of the CCMA when handling the negotiation process.
This news item, filed from Johannesburg, showed up on the mineweb.com Internet site yesterday---and it's the first of three in a row from Ulrike Marx.
Platinum holdings in physically backed exchange-traded funds have hit a record high after fresh inflows into funds listed in London and Johannesburg, and are set to rise further as a strike in major producer South Africa grinds on.
The world's largest platinum-backed ETF, NewPlat ETF reported an inflow of around 4,000 ounces on Monday, taking its holdings to a near seven-week high at 908,811 ounces.
On the same day, London-based ETFS Physical Platinum reported an inflow of 4,505 ounces, taking its holdings to just under 325,000 ounces.
Platinum ETFs, popular investment vehicles which issue securities backed by physical metal, now hold a record 2.215 million ounces, equivalent to around seven months of supply.
This Reuters story, filed from London, was posted on their Internet site early yesterday morning EDT---and it's the second offering in a row from Ulrike Marx.
So far this year gold has probably been the best performing asset class of all having risen around 12% to date. But, within the overall precious metals sector, silver has only moved up a seemingly disappointing 7%, platinum 8% and palladium perhaps an even more disappointing 5% - despite analysts almost being unanimous in their views that the platinum group metals (pgms) in particular will outperform given the ongoing industrial action in South Africa, the world’s largest producer.
The South African situation is potentially severely disrupting supplies, while the global economy is seen as being in a recovery phase, which should indeed be a positive for the pgms given that within the Western recovery – and also with ongoing Chinese sales increasing – the automobile sector seems to be doing particularly well and that is the principal user of pgms, especially palladium.
So, in looking at the sector overall one could suggest that silver and the pgms are under-performing – but that is only relative to the gold price. In short, even a 5% rise over the first 10 weeks of the year is actually quite a good performance – particularly relative to say the S&P 500 which has risen just 2.5% over the same period. Simplistically, the same rate of growth extrapolated over the full year would suggest the S&P growing around 13% and the pgms and silver growing between 25 and 50% over the period , a pretty good performance in anyone’s investment book.
This commentary by Lawrie was posted on the mineweb.com Internet site yesterday as well---and is the final contribution to today's column from Ulrike Marx.
Moments ago McDonalds reported its latest monthly comp store sales numbers. Printing at -1.4% for the US, this was a nearly double miss to expectations of a 0.6% decline, and was the 4th consecutive monthly drop in annual sales - the longest such stretch in the past decade and likely longer. Looking at this data, there are two observations: i) Americans, courtesy of record obesity rates, are finally getting serious about their health, and have shunned the infamous 99 cent deep fried meals or ii) courtesy of the Fed's "Fed's recovery", the average American can no longer even afford sub-$1 deep fast food.
There is a third option: that it snowed... In fact it snowed so much, everywhere, and the weather was so harsh around the world, that global store sales declined by 0.3%, far below the modest 0.1% drop expected. Yup. Must have been the snow.
This tiny Zero Hedge story is worth the the trip just for a peek at the embedded charts. I thank reader M.A. for today's first news item.
The U.S. Securities and Exchange Commission is investigating whether currency traders at the world's biggest banks distorted prices for options and exchange-traded funds by rigging benchmark foreign-exchange rates, according to two people with knowledge of the matter.
The SEC's inquiry adds to European and U.S. regulatory probes of possible manipulation in currency markets. The SEC's investigation is in the early stages, said the people, who asked not to be named because the matter isn't public. The Commodity Futures Trading Commission, which regulates foreign-exchange derivatives, is also investigating possible manipulation, another person said.
This Bloomberg story, filed from New York, was posted on their Internet site very early yesterday morning MDT---and I found it embedded in a GATA release.
In July 2006, during lunch at an upmarket restaurant overlooking the sprawling Smithfield meat market in the City of London, Bank of England officials and senior bank dealers discussed evidence of potential manipulation of the foreign exchange market. People at the lunch said the attempts to move the market meant the process of establishing official prices - known as "fixing" - was becoming "increasingly fraught".
It was two years before the issue was discussed again, according to minutes from the meetings, released after a Reuters freedom of information request, and seven years before the Financial Conduct Authority (FCA), Britain's financial regulator, kicked off a global investigation and banks started to suspend or layoff traders.
The FCA probe focuses on whether traders used advance knowledge of customer orders to try and manipulate benchmark foreign exchange rates for their own gain, and is a blow to the "hands off" approach to regulating the world's largest financial market.
This Reuters piece, filed from London, was posted on their website late Friday morning EST---and it's another story that I found tucked away in a GATA release.
The Telegraph can reveal that the Bank’s oversight committee is set to appoint an external heavyweight to run an independent assessment of the Bank’s actions both in relation to the allegations made and how it has handled those allegations.
The heavyweight figure could be a judge, an academic or a City executive. He or she would need to be far enough removed from the Bank to ensure the inquiry is seen as independent.
The Bank’s committee appointed the law firm, Travers Smith, last week to prepare a formal report which will be made public.
This news item appeared in The Telegraph late on Saturday evening GMT---and is another article I found on the gata.org Internet site.
George Soros, the billionaire investor, believes the banking sector is a “parasite” holding back the economic recovery and an “incestuous” relationship with regulators means little has been done to resolve the issues behind the 2008 crisis.
“The banking sector is acting as a parasite on the real economy,” Mr Soros said in his new book “The Tragedy of the European Union”.
“The profitability of the finance industry has been excessive. For a while 35pc of all corporate profits in the United Kingdom and the United States came from the financial sector. That’s absurd.”
“Very little has been done to correct the excess leverage in the European banking system. The equity in the banks relative to their balance sheets is wafer thin, and that makes them very vulnerable.
This article/book review was posted on the telegraph.co.uk Internet site---an it showed up at noon GMT on Saturday---and it's the first offering of the day from Roy Stephens.
A leading German institute has called for full-blown quantitative easing by the European Central Bank (ECB) to head off a deflation spiral, marking a radical shift in thinking among the German policy elites.
Marcel Fratzscher, head of the German Institute for Economic Research (DIW) in Berlin, demanded €60bn (£50bn) of bond purchases each month to halt the contraction of credit and avert a Japanese-style trap.
"It is high time for the ECB to act. Otherwise Europe risks falling into a dangerous downward spiral of sliding prices and declining demand", he wrote in Die Welt.
"The ECB must counter the deflation threat quickly and decisively, and launch a broad-based programme of bond purchase along the lines of the Federal Reserve," he said. The scale should be 0.7pc of eurozone state debt each month, comparable to 'QE3' in the U.S.
It's "Print, or die" for Europe as well. This Ambrose Evans-Pritchard commentary showed up on The Telegraph's website early yesterday afternoon GMT---and it's the second contribution in a row from Roy Stephens. It's worth reading.
While the U.S. may be rejoicing its daily stock market all time highs day after day, it may come as a surprise to many that global equity capitalization has hardly performed as impressively compared to its previous records set in mid-2007. In fact, between the last bubble peak, and mid-2013, there has been a $3.86 trillion decline in the value of equities to $53.8 trillion over this six year time period, according to data compiled by Bloomberg. Alas, in a world in which there is no longer even hope for growth without massive debt expansion, there is a cost to keeping global equities stable (and US stocks at record highs): that cost is $30 trillion, or nearly double the GDP of the United States, which is by how much global debt has risen over the same period. Specifically, total global debt has exploded by 40% in just 6 short years from 2007 to 2013, from "only" $70 trillion to over $100 trillion as of mid-2013, according to the BIS' just-released quarterly review.
It should come as no surprise to anyone by now, but the only reason why global stocks haven't plummeted since the Lehman collapse is simple: governments have become the final backstop for onboarding risk, with a Central Bank stamp of approval - in other words, the very framework of the fiat system is at stake should global equity levels collapse. The BIS admits as much: “Given the significant expansion in government spending in recent years, governments (including central, state and local governments) have been the largest debt issuers,” according to Branimir Gruic, an analyst, and Andreas Schrimpf, an economist at the BIS.
It should also come as no surprise that courtesy of ZIRP and monetization of debt by every central bank, debt has itself become money regardless of duration or maturity (although recent taper tantrums have shown what will happen once rates start rising across the curve again), explaining the mind-blowing tsunami of new debt issuance, which will certainly never be repaid, and whose rolling will become impossible once interest rates rise. But of course, under central planning that is not allowed. As Bloomberg reminds us, marketable U.S. government debt outstanding has surged to a record $12 trillion, up from $4.5 trillion at the end of 2007, according to U.S. Treasury data compiled by Bloomberg. Corporate bond sales globally jumped during the period, with issuance totaling more than $21 trillion, Bloomberg data show.
This longish but very worthwhile Zero Hedge piece was posted on their website late on Sunday morning EST---and I thank Manitoba reader Ulrike Marx for her first story of the day.
In his first live public appearance since fleeing the U.S. after leaking thousands of secret intelligence documents, Edward Snowden warned that the National Security Agency (NSA) is ruining the Internet.
Snowden, who obtained asylum in Russia after helping to expose the NSA’s dragnet surveillance of millions of Americans, was speaking at the South by Southwest (SXSW) festival in Texas on a panel about how NSA spying impacts the tech community. He spoke via livestream, with an image of the Constitution as his background.
U.S. government surveillance is “setting fire to the future of the internet,” he told the crowd, adding that “you guys in the room are the global firefighters.” He was referring to ways to combat mass surveillance, like using encryption and TOR, a way to browse the Internet anonymously. Also speaking on his panel was the American Civil Liberties Union’s Ben Wizner and Christopher Soghoian.
This news item appeared on the alternet.org Internet site yesterday---and my thanks go out to Roy Stephens once again.
1. Ukraine crisis: Russian troops take Ukrainian border guards hostage: The Telegraph 2. Details of sanctions against Russia to be finalised in London: The Guardian 3. Confrontation in Ukraine as diplomacy stalls: Reuters 4. NATO to deploy jets to monitor Ukraine crisis: France 24
[All the above stories courtesy of Roy Stephens]
Abolghassem Mesbahi, a defector to Germany, said Pan Am flight 103 was downed in 1988 in retaliation for a U.S. Navy strike on an Iranian commercial jet six months earlier, in which 290 people died.
He claims the Ayatollah Khomeini, who was Iran’s Supreme Leader, ordered the bombing “to copy exactly what happened to the Iranian Airbus”.
Previously unseen evidence gathered for the aborted appeal hearing of Abdelbaset al-Megrahi, the former Libyan intelligence officer convicted of the bombing, supports Mr Mesbahi’s claim and suggests that the bombers belonged to the extremist group the Popular Front for the Liberation of Palestine – General Command (PFLP-GC).
Documents obtained by Al Jazeera television for a documentary called Lockerbie: What Really Happened? name key individuals said to be involved in the bombing, including the alleged bomb-maker, the alleged mastermind and the man who may have put the bomb on the doomed Boeing 747.
This very surprising story showed up on the telegraph.co.uk Internet site late last night GMT---and it's another item I found in a GATA release.
China’s CSI 300 Index (SHSZ300) plunged to the lowest level in five years and the yuan weakened as an unexpected drop in exports spurred concern that the world’s second-largest economy is slowing.
The index of the largest Chinese stocks slid 3.3 percent to 2,097.79 at the close, the lowest since February 2009, while the Shanghai Composite Index tumbled 2.9 percent, the most since June. The yuan fell 0.2 percent to 6.1385 per dollar. Money-market rates slumped to a 21-month low amid speculation demand for cash is diminishing as economic growth weakens.
Overseas shipments plunged 18.1 percent in February, compared with analysts’ median estimate for a 7.5 percent increase, as distortions from the Lunar New Year holiday made forecasting more difficult. Investors are looking for policy guidance from this month’s National People’s Congress in Beijing amid concerns over slowing growth, a flood of new share sales and geopolitical tension between Russia and Ukraine.
This Bloomberg article from yesterday, co-filed from Singapore and Hong Kong, is worth reading. It was posted on their website in the wee hours of yesterday morning Denver time---and it's courtesy of West Virginia reader Elliot Simon.
China’s onshore bond market experienced its first default as a solar-cell maker failed to pay full interest on its bonds, signaling the government will back off its practice of bailing out companies with bad debt.
Shanghai Chaori Solar Energy Science & Technology Co. is trying to sell some of its overseas plants to raise money to repay the debt, Vice President Liu Tielong said in an interview yesterday at the company’s Shanghai headquarters. The company said March 4 it would only be able to pay 4 million yuan ($653,000) of an 89.8 million yuan coupon due yesterday.
The number of Chinese companies whose debt is double their equity has surged since the global financial crisis, suggesting this first onshore bond default won’t be the nation’s last. Publicly traded non-financial companies with debt-to-equity ratios exceeding 200 percent have jumped 57 percent since 2007. Chaori Solar may become China’s own “Bear Stearns moment,” prompting investors to reassess credit risks as they did after the U.S. securities firm was rescued in 2008, according to Bank of America Corp.
This Bloomberg story, co-filed from Singapore and Shanghai, is definitely worth reading. It showed up on their Internet site Friday morning MST---and I thank Casey Research's own Marin Katusa for bringing it to our attention.
China is likely to ease controls on interest rates paid on bank savings within two years and will allow wider use of its tightly controlled currency for trade and investment, the central bank governor said Tuesday.
Zhou Xiaochuan's comments follow pledges by Chinese leaders to make the country's slowing economy more productive by giving market forces a "decisive role" in allocating credit and other resources.
Allowing banks to compete for deposits by paying higher rates on savings would put more money in the pockets of Chinese families, helping to achieve official goals of boosting consumer spending and reducing reliance on trade and investment.
"Liberalization of deposit rates, this should be the last step in interest rate marketization," said Zhou at a news conference. "I personally believe it is very possible to realize this within one to two years."
This AP story, filed from Beijing earlier this morning, found a home over at the usnews.com Internet site---and I thank Elliot Simon for sliding it into my in-box just after 2 a.m. EDT this morning.
1. John Embry: "Propaganda, Lies---and a World Headed For Disaster" 2. William Kaye: "Did Ukraine Just Airlift Its Entire Gold Hoard to the U.S. Fed? 3. Egon von Greyerz: "The Ukraine Crisis and a Terrifying Global Economic Meltdown" 4. Michael Pento: "The Rate of This Worldwide Depression Will Only Get Worse" 5. Dr. Paul Craig Roberts: "The World is Now on the Edge of Nuclear War" 6. Robert Fitzwilson: "Investors Need to Stay Focused With Ukraine Crisis Unfolding" 7. The first audio interview is with Michael Pento---and the second audio interview is with Gerald Celente
[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests, to them, and not to me. Thank you. - Ed]
numerous gold- and silver-coin shipments has closed shop, according to a posting on the company's Costa Mesa office window.
"The Tulving Company has closed. More information the week of March 10th," reads the sign, which was seen Thursday at the firm's headquarters.
It appears a flood of complaints against The Tulving Company and owner Hannes Tulving Jr. led to a state investigation.
No surprises here, as Joshua Gibbons over at the about.ag Internet site has been on top of this situation for months. This news item showed up on the Orange County Register's website last Thursday---and it's another article I found on the gata.org Internet site on Saturday.
Gold researcher and GATA consultant Koos Jansen explains today that while a Citi Research report has done a little better in calculating China's gold demand than other Western sources, the report still grossly underestimates it.
Jansen's commentary is headlined "Chinese Gold Demand 418 Tonnes Year to Date, West Confused" and it was posted at the Swiss Internet site ingoldwetrust.ch on Sunday afternoon Europe time. It's another story I found in a GATA release.
Norman speaks in half-truths in this 6:13 minute video interview on BNN on Friday. His comments about the London fixes may be true in the context he's talking about---but it's just one element in the overall price management scheme in gold that's been going on for about 15 years. Maybe he'd like to be re-interviewed and discuss the contents of The Wrap section in my Friday column, as the two charts shows clearly that he lied by omission. The four charts from the Bank Participation Report in the first section of Saturday's column put icing on the cake.
I found this interview on the sharpspixley.com Internet site in the wee hours of yesterday morning.
Coutts & Co. is adding gold for investors as rising wealth in China and increasing political risks including in Ukraine spur demand, helping prices rally from the biggest annual decline in more than three decades.
The private-banking division of Royal Bank of Scotland Group Plc holds 3 percent to 4 percent in its portfolios, from 1 percent to 2 percent last year, said Gary Dugan, chief investment officer for Asia and the Middle East. Coutts had 29.7 billion pounds ($49.4 billion) under management as of Dec. 31.
Gold rebounded this year as rising consumption in Asia and emerging-market turmoil boosted demand. The value of bullion held in exchange-traded products climbed 10 percent to $75.5 billion this year as prices advanced and holdings increased in February for the first time in 14 months. China surpassed India as the world’s largest user last year as demand expanded 32 percent, according to the World Gold Council.
This very interesting Bloomberg story appeared on the mineweb.com Internet site yesterday---and I thank Ulrike Marx for her second contribution to today's column.
Sprott CEO Eric Sprott, interviewed by Sprott Money News, comments on the lawsuits that are starting to be filed against the investment houses participating in the daily London gold fix.
This audio interview was conducted last Friday---and is definitely worth your time.
GATA Chairman Bill Murphy and GoldMoney research director Alasdair Macleod, interviewed by FinanceAndLiberty.com's Elijah Johnson, discuss the growing suspicions about the daily London gold fix, the slow pace of the repatriation of the German Bundesbank's gold reserves, and other matters of gold price suppression.
The interview is 25:42 minutes long and was posted on the youtube.com Internet site yesterday
The Russian-language and pro-Russian Internet news organization, Iskra ("Spark") News in Zaporozhye, eastern Ukraine, which perhaps has taken its name from the early socialist newspaper founded by Lenin reported Friday that Ukraine's gold reserves had been hastily airlifted to the United States from Borispol Airport just east of Kiev.
A Google-assisted translation is appended.
Last night GATA asked the Federal Reserve Bank of New York and the U.S. State Department to disclose whether the United States has taken custody of Ukraine's gold reserves. A publicist for the New York Fed immediately acknowledged the inquiry and said he would look into the issue right away. We'll keep you posted.
This GATA release was posted on their Internet site yesterday evening EDT---and is worth reading. The good folks over at Zero Hedge also had a story about this as well---and it's linked here.
Many investors, especially those new to precious metals, don't know that gold is seasonal. For a variety of reasons, notably including the wedding season in India, the price of gold fluctuates in fairly consistent ways over the course of the year.
This pattern is borne out by decades of data, and hence has obvious implications for gold investors.
Can you guess which is the best month for buying gold?
When I first entertained this question, I guessed June, thinking it would be a summer month when the price would be at its weakest. Finding I was wrong, I immediately guessed July. Wrong again, I was sure it would be August. Nope.
Cutting to the chase, here are gold’s average monthly gain and loss figures, based on almost 40 years of data.
This very worthwhile read was embedded in yesterday's edition of the Casey Daily Dispatch.
Following a record year for gold imports, Turkey's appetite for the yellow metal is suddenly waning.
According to the country's Hurriyet Daily, Turkey's gold imports dropped 93% in February, compared with the same month in 2013.
The fall comes amid a rise in the gold price – going from an average of $1,214 in December to $1,264 in January – but it's also due to the end of Turkey's gold-for-gas deal with Iran.
Under the controversial scheme, Turkey circumvented Western sanctions by paying for Iranian oil and natural gas in gold. Turkey's Halkbank claims these transactions ended last summer.
This very short story showed up on the mining.com Internet site on Sunday---and I thank reader M.A. for sending it our way.
The American economy stirred to life last month, creating more jobs than in the previous two winter months and raising hopes that momentum in the labor market would gradually pick up as the cold weather in many parts of the country eases with the arrival of spring.
The report from the Labor Department for February, which came on Friday after job figures for December and January that were much weaker than the underlying trend, eased fear that the economy was downshifting to a slower pace. The data led some experts to conclude that weather, not a fundamental slowdown, was a major factor behind the recent shortfalls.
With employers hiring 175,000 workers, the payroll gain in February was hardly cause for celebration — it was still well short of the pace needed to return the economy to full employment in the next few years. But it was twice the number added in December, when the cold and snow arrived.
It's a good bet that the numbers were massaged to perfection before the public ever saw them. This story was posted on The New York Times website yesterday---and I thank Ken Hurt for today's first story. [I noted when I was editing this column at 5:54 a.m. EST, that this story now sports a new and more up-beat headlined "As Job Creation Increases in February, Economists See Signs of a Spring Thaw."]
Bill Gross, the co-founder and co-chief investment officer of Pacific Investment Management Co, has accused departing CEO Mohamed El-Erian of seeking to "undermine" him by talking to The Wall Street Journal about deepening tensions between the two executives who have been jointly running the world's largest bond house.
Gross told Reuters that he had "evidence" that El-Erian "wrote" a February 24 article in the Journal, which described the worsening relationship between the two men as Pimco's performance deteriorated last year, including a showdown in which they squared off against each other in front of more than a dozen colleagues at the firm's Newport Beach, California headquarters.
Gross, who oversaw more than $1.91 trillion in assets as of the end of last year and who is known on Wall Street as the 'Bond King', said in a phone call to Reuters last Friday: "I'm so sick of Mohamed trying to undermine me."
When asked if Reuters could see the evidence about El-Erian and the allegation he was involved in the article, Gross said: "You're on his side. Great, he's got you, too, wrapped around his charming right finger."
This interesting Reuters story was posted on their website yesterday afternoon EST---and it's courtesy of West Virginia reader Elliot Simon.
I fear that the unfolding Ukrainian crisis and rising tensions between China and Japan are no mere coincidence. I have no reason to believe that Russian and Chinese officials are coordinating their geopolitical thinking, maneuvers or strategies. I do, however, sense that the changing global financial and economic backdrop is altering incentives, disincentives and the calculus of cooperation, coordination and confrontation.
The world is indeed changing, but certainly not in the manner those seduced by inflating securities prices behold. Sure, central bank liquidity is still expanding and the global debt mountain just keeps rising to the stars, increasingly unhinged from real economic wealth. Yet the global economic pie has begun to decay. I fully expect mounting domestic economic and global political pressures to increasingly dictate a much more aggressive stance with respect to “geopolitics.”
I’ll further add that I don’t believe the ongoing melt-up in U.S. stocks and the rapidly deteriorating geopolitical backdrop are coincidental. Again, from my analytical framework, both are creatures of historic monetary inflation. Serious (faltering Bubble) stress at the “periphery” now dictates erratic behavior many would view (from the old world view) as irrational. Meanwhile, liquidity flooding into the “core” feeds a historic speculative Bubble. The Russians might very well see it in their relative best interest to dig uncompromisingly in for the long hall, believing the West actually has more to lose. The backdrop would seem to ensure we’re entering a period of extraordinary uncertainty, although over-liquefied securities markets remain priced for extraordinarily low risk.
Doug's weekly Credit Bubble Bulletin is always a must read---and I pulled it off the prudentbear.com Internet site before reader U.D. got around to sending it to me.
Thousands of Credit Suisse Group AG (CSGN)’s U.S. clients still don’t know whether tax authorities will learn their identities as prosecutors work to conclude a three-year probe of how the bank helped them evade taxes.
U.S. senators last week faulted the Justice Department for securing names for only 238 of 22,000 Americans with Credit Suisse accounts, saying the bank helped them hide as much as $10 billion from the Internal Revenue Service.
The pressure of a subcommittee report and hearings will force prosecutors to act more aggressively as they negotiate a settlement with Credit Suisse to end the probe and get more names, said Jeffrey Neiman, a former federal prosecutor.
This Bloomberg story was posted on their Internet site yesterday morning Denver time---and I thank Ulrike Marx for her first contribution to today's column.
National Security Agency leaker Edward Snowden answered questions before the European Parliament on Friday, saying that the United States spy agency pressures its allies to take steps towards further enabling widespread and indiscriminate surveillance.
“One of the foremost activities of the NSA's FAD, or Foreign Affairs Division, is to pressure or incentivize EU member states to change their laws to enable mass surveillance,” Snowden said in a testimony delivered remotely from Russia. “Lawyers from the NSA, as well as the UK's GCHQ, work very hard to search for loopholes in laws and constitutional protections that they can use to justify indiscriminate, dragnet surveillance operations that were at best unwittingly authorized by lawmakers.”
“These efforts to interpret new powers out of vague laws is an intentional strategy to avoid public opposition and lawmakers’ insistence that legal limits be respected,” Snowden added.
This very interesting commentary was posted on the Russia Today website late yesterday afternoon Moscow time---and it's the first offering of the day from Roy Stephens.
1. Ukraine standoff intensifies, Russia says sanctions will 'boomerang': Reuters 2. Steeped in Its Bloody History, Again Embracing Resistance: The New York Times 3. Russia supports Crimean parliament's request to join Federation: UPI 4. Pro-Russia Gunmen Block OSCE Monitors Entering Ukraine; Stymie Obama's Plan: Zero Hedge 5. IMF says Ukrainian officials committed to reforms: Reuters 6. Russia Invokes $2 Billion Ukraine Gas Debt Amid Crimea Crisis: Bloomberg 7. Russia rallies support for Crimea breakaway: al Jazeera
[The above stories are courtesy of Elliot Simon, Ulrike Marx and Roy Stephens]
March 16 is C Day. The Crimean parliament - by 78 votes with 8 abstentions - decided this is the day when Crimean voters will choose between joining the Russian Federation or to remain part of Ukraine as an autonomous region with very strong powers, according to the 1992 constitution.
Whatever "diplomatic" tantrums Washington and Brussels will keep pulling, and they will be incandescent, facts on the ground speak for themselves. The city council of Sevastopol - the headquarters of Russia's Black Sea fleet - has already voted to join Russia. And next week the Duma in Moscow will study a bill to simplify the mechanism of adhesion.
Quick recap: this is a direct result of Washington spending US$5 billion - a Victoria "F**k the EU" Nuland official figure - to promote regime change in Ukraine. On the horizon, Crimea may be incorporated into Russia for free, while the "West" absorbs that bankrupt back-of-beyond (Western Ukraine) that an Asia Times Online reader indelibly described as the "Khaganate of Nulands" (an amalgam of khanate, Victoria's notorious neo-con husband Robert Kagan, and no man's land).
What Moscow regards as an illegal, neo-nazi infiltrated government in Kiev, led by Prime Minister Arseniy "Yats" Yatsenyuk - an Ukrainian Jewish banker playing the role of Western puppet - insists Crimea must remain part of Ukraine. And it's not only Moscow; half of Ukraine itself does not recognize the Yats gang as a legitimate government, now boasting a number of oligarchs imposed as provincial governors.
This absolute must read commentary by Pepe was posted on the Asia Times website yesterday---and I thank Ulrike Marx for bringing it to our attention.
It's time for the United States to engage in a full-throated celebration of the pivot to Asia with what I think is going to be President Barack Obama's "America F*ck Yeah" tour of Asian democracies in April. The trip requires more than a little spadework, given the rather fraught situation in Asia.
It is not just that the People's Republic of China (PRC) and Japan are at each other's throats. Nor is the sole problem that the Philippines has declared that the South China Sea is the new Sudetenland and the PRC must be met with confrontation, not negotiation. The issue is that the United States is less than completely happy with Japanese Prime Minister Shinzo Abe's sharp elbows and the fractures they create in the pivot's united front.
There has been a fascinating flurry of op-eds in U.S. prestige media (Bloomberg, NY Times, Washington Post, and Business Week) highly critical of Abe and his provocative visit to the Yasukuni Shrine - a visit that took place in December 2013. Concerned chin-stroking at the end of February 2014 is a little late, it would seem.
Roy Stephens sent me this Asia Times story back on February 25---and I missed putting it in last Saturday's column, so here it is now. It's a must read as well---especially for all serious students of the New Great Game.
[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests, to them, and not to me. Thank you. - Ed]
“When I look at asset prices; real estate, bonds, equities, vintage cars… I think that gold is actually one of the few assets that is relatively cheap, relatively inexpensive.”
Marc Faber, author of the Gloom, Boom, and Doom Report, and a Director of Sprott Inc. shared his most recent views during a recent visit to our offices… In particular, he’s seeing cracks in the broad stock market become apparent.
This longish interview with Marc was posted on the sprottglobal.com Internet site yesterday---and it's definitely worth reading.
I haven't had the time to listen to this entire 20:48 minute video presentation by Mike, but from what I've seen so far, it's definitely worth your while. It was posted on the youtube.com Internet site on Tuesday, and has already had more than 33,000 hits but, because of its length, it had to wait until today's column.
Jim appeared on the Russia Today financial program "Boom/Bust" on Thursday---but I had so many stories in my Friday column already---and I received the clip in the wee hours of Friday morning---I thought it best to wait until today's column when you may have more time on your hands to watch the whole thing.
The interviews starts on the topics mentioned in the headline above, but digresses a bit from there as the interview proceeds. The segment with Jim starts at the 4:35 minute mark and runs for about 8 minutes. It's certainly worth watching---and I thank reader Harold Jacobsen for sending it our way.
The digital “Bitcoin” has bit the dust at Mt. Gox Bitcoin Exchange; over $400 million US has evaporated, or perhaps moved into someone’s pocket. The news is all over the Internet these days.
“Digital money” is accepted world-wide. There exists only a remnant of fiat paper money which is increasingly and deliberately made more difficult to use and transport physically. The reason being, that digital transactions leave a trail of information which governments use to control the behavior of their subjects (we can hardly call them “citizens” any longer) whereas citizens using paper money in their dealings leave no trail.
A bank in Mexico, of which I have personal knowledge, receives millions in dollar bills every week in thousands of individual money-exchange transactions. This presents a problem for the bank. Why? Because not one bank in the US will accept these dollar bills (mostly twenties) for credit to the Mexican bank’s account.
Only the long-established Mexican banks can remit their dollar bills for credit to the US, and then, only to Bank of America. The bank of which I speak is relatively new – though it has well over 12 million individual account holders - and Bank of America will not receive dollar bills from it. Other Mexican banks of recent creation are in the same fix.
This excellent commentary by Hugo was posted on the plata.com.mx Internet site on Tuesday---and I thank U.K. reader Tariq Khan for sharing it with us.
Yesterday, gold researcher and GATA consultant Koos Jansen published an English translation of another remarkable commentary by a Chinese market analyst, newsletter editor, and consultant to the China Gold Association, Zhang Jie.
Zhang's commentary, written last year, asserts:
-- China, like Germany, has stored gold at the Federal Reserve Bank of New York but cannot try to repatriate it without risking "a tremendous confrontation."
-- China's government is exploiting the Western central bank gold price suppression scheme by buying gold on the sly through intermediaries to hedge its foreign exchange surplus against depreciation by "quantitative easing" and a currency crisis. Buying gold "is the most effective means to protect China's foreign exchange reserve wealth from the threat of the Western financial hegemony."
I found this absolute must read commentary by Koos Jansen embedded in a GATA release from yesterday.
Evidence emerging in the United Kingdom about the possible manipulation of the gold price for a decade could have major implications for South African investors and mining companies who might be able to sue for damages in terms of South African law.
The London gold fix benchmark, set by five banks twice a day, is used worldwide by mining companies, central banks, and jewellers to value gold. A similar process, involving three banks, is used to value silver.
This week a New York resident, Kevin Maher, lodged a case in U.S. District Court for the Southern District of New York seeking unspecified damages against Barclays, HSBC Holdings, Bank of Nova Scotia, Société Générale SA, and Deutsche Bank, on the grounds that they worked together and manipulated the benchmark.
It would be wonderful news if this would gain some traction in another rich country that insists on being poor---in this case, South Africa. This news item was posted on the website of The Mail & Guardian in Johannesburg yesterday---and I found it on the gata.org Internet site.
The government has tightened norms for Indians bringing gold into the country following a spurt in smuggling and pressure on inward remittances as overseas workers prefer to bring their savings in gold.
Passengers will now have to mention the engraved serial number of gold bars in the baggage receipt issued by Customs. For bringing gold in any other form, including ornaments, passengers will have to declare item-wise inventory of the ornaments being imported with baggage receipt, according to a Central Board of Excise & Customs directive.
The apex indirect taxes body has also directed its field officials to ascertain the antecedents of such passengers, source of funding for gold as well as duty being paid in foreign currency, person responsible for booking of tickets to prevent the possibility of misuse of the facility by unscrupulous elements, who may hire such eligible passengers to carry gold for them.
This short gold-related news item was posted on the Economic Times of India website very early yesterday morning IST---and I thank Ulrike Marx for her final contribution to today's column.
There is something rather absurd about the ever-so-slightly loosening death grip that the mainstream financial media has around the issue of precious metals price manipulation. The painfully reluctant (and largely incomplete) reports on the subject have fueled a series of seemingly derivative-like conspiracies.
It's not as if the issue is really that complicated. Therefore, it must be part and parcel - an extension of the mechanism. Perhaps the hope is that partially educating or entertaining the masses, followed by rebuttals from a string of authorities, would put the issue to bed? But clearly, it cannot be that complex.
Most of you are familiar with the core issues. It would take approximately 15 minutes to explain and demonstrate to a well-trained financial journalist the conspiracy facts surrounding precious metals price manipulation. It is the same management that occurs every day in all directions, intended for profit and to control the rate of interest, perception of currencies, and the value of money.
This excellent must read commentary by Jeffrey was posted on the silver-coin-investor.com Internet site yesterday---and it's another item I found in a GATA release from yesterday.
Nothing says global 'economic recovery' like a major retailer drastically missing revenue expectations, slashing earnings projections and announcing it will shutter 225 stores nationwide. Staples, the largest US office supplies retailer, hit the triple whammy and didn't blame it all on the weather as the CEO notes "our customers are using less office supplies." Or maybe there are just less office workers? Isolating Staples is a little unfair but as the largest (and most bellwether-ish), it is perhaps time to question the constant meme of escape velocity, improving fundamentals, and cleanest-dirty-shirt growth.
This news item was posted on the Zero Hedge website late yesterday morning EST---and I thank reader M.A. for today's first story.
Moody’s Investor's Service has downgraded Chicago’s credit rating, citing the city’s unfunded pension liabilities.
The agency announced Tuesday it’s lowering the rating on $8.3 billion in debt from A3 to Baa1, putting it only three notches above junk-bond status.
Moody’s gave Chicago a negative outlook indicating another downgrade could occur if there’s no pension fix. Moody’s says the rating “reflects the city’s massive and growing unfunded pension liabilities.”
Moody’s says those liabilities “threaten the city’s fiscal solvency” unless major revenue and other budgetary adjustments are adopted soon and are sustained for years to come.
This very brief CBS/AP story was posted on the cbslocal.com Internet site very early Tuesday evening CST---and I thank U.A.E. reader Laurent-Patrick Gally for sending it our way.
Bank of America Corp., the second-biggest U.S. lender, suspended a senior foreign-exchange dealer amid a probe into the alleged manipulation of currencies, a person with knowledge of the matter said.
Joseph Landes, the London-based head of spot foreign exchange for Europe, Middle East and Africa, has been put on leave while the bank investigates, said the person, asking not to be identified as the details are private. Landes, the first trader known to have been suspended by Bank of America in the investigation, didn’t respond to an e-mail or calls to his work phone or mobile. Lawrence Grayson, a Bank of America spokesman, declined to comment on the suspended employee.
At least 21 employees of global banks have been fired, suspended or put on leave since Bloomberg News first reported in June that dealers said they shared information about client orders to manipulate benchmark rates used in the $5.3 trillion-a-day currency market. No firms or traders have been accused of wrongdoing by government authorities.
This Bloomberg story was posted on their Internet site yesterday morning MST---and it's the first contribution of the day from Manitoba reader Ulrike Marx.
Federal Reserve Chair Janet Yellen vowed on Wednesday to "do all that I can" to boost a U.S. economy where unemployment is too high and inflation is too low.
"The economy continues to operate considerably short" of the central bank's objectives of full employment and stable prices, Yellen said at a swearing-in ceremony at the central bank in Washington.
"The economy is stronger and the financial system is sounder," added Yellen, who succeeded Ben Bernanke on February 1. "We have come a long way, but we have farther to go."
This article showed up on the moneynews.com Internet site early yesterday morning EST---and it's the first offering of the day from West Virginia reader Elliot Simon.
Bank of England policy makers extended unprecedented stimulus into a sixth year today as they seek to ensure the economy fully recovers from the damage wrought by the financial crisis.
The Monetary Policy Committee led by Governor Mark Carney held its benchmark interest rate at 0.5 percent, as predicted by all 52 economists in a Bloomberg News survey. The central bank has maintained borrowing costs at a record low since March 2009, the longest stretch of unchanged policy since the 1940s. It also said today it will reinvest funds from gilts in its asset-purchase facility that mature tomorrow.
Carney says there’s “no rush” to remove the emergency stimulus put in place by his predecessor Mervyn King, even after the strongest expansion since 2007 pushed unemployment toward the 7 percent level at which officials had said they’d consider a rate increase. With signs the recovery is becoming entrenched, traders are betting the BOE will lift borrowing costs next year after officials raised their growth forecasts last month.
This short Bloomberg story, filed from London, was posted on their Internet site very early yesterday morning MST---and it's the second offering of the day from Ulrike Marx.
Italy and France were the major euro area countries put on the European Commission's economic "watch-list" over fears about persistently high debt and deficit levels.
The two countries were among 14 nations deemed to have "macro-economic imbalances" in their economy by the EU executive in a series of reports on 17 countries published on Wednesday (5 March).
Italy "must address its very high level of public debt and weak external competitiveness," the commission said, adding that its economy is hamstrung by "a continued misalignment between wages and productivity, a high labour tax wedge, an unfavourable export product structure and a high share of small firms which find it difficult to compete internationally."
This news item, filed from Brussels, was posted on the euobserver.com Internet site late yesterday morning Europe time---and it's the first contribution to today's column from Roy Stephens.
Lights, camera…no action. There had been such a build up to today's council meeting of the European Central Bank – which had been very much encouraged by the president, Mario Draghi, with talk of possible further credit easing, funding for lending, and so on – that when nothing happened, it was, to put it mildly, a bit of letdown. Did he want to do more, but was blocked by all the usual suspects? Almost certainly yes, though you rarely get to the bottom of these matters.
In any case, the ECB's inaction in the face of continued credit contraction and a clear and present danger of price deflation perhaps shouldn't really have come as such a surprise. The ECB has proved itself an extraordinarily cautious animal, and today's lack of fire works is just true to form.
For those clutching at straws, Mr Draghi did at least say that policy would remain extraordinarily accommodative even after the data started to show significant improvement. Mr Draghi was also relatively convincing in his explanation of why inflation was so low. Mainly, it is about falling energy prices he pointed out. In the eurozone, the average historical contribution of energy prices to annual HICP inflation was 50 basis points. In February it was minus 30 basis points. Some two thirds of the fall in inflation since early 2012 is accounted for energy prices.
Jeremy Warner over at The Telegraph has his knickers in a twist in this commentary that was posted on the telegraph.co.uk Internet site yesterday---and it's courtesy of Roy Stephens.
The International Monetary Fund has warned of the risks of low inflation and called for the European Central Bank to help strengthen the region's economy ahead its policy decision on Thursday.
The IMF blog, written by economists led by Reza Moghadam, director of the fund's European Department, says that Europe "can have too much of a good thing, including low inflation."
It comes despite better-than-expected euro zone inflation data, which came at 0.8 percent in February - welcome news for the ECB, as previous figures had fueled concerns about growth-sapping deflation.
"The ECB must be sure that policies are equal to the tasks of reversing the downward drift in inflation and forestalling the risk of a slide into deflation," Moghadam wrote.
This article showed up on the CNBC website on Wednesday morning EST---and I found it in yesterday's edition of the King Report.
1. Crimea 'votes' to join Russia as E.U. leaders meet: E.U. Observer 2. Ukrainian leader declares Crimea referendum an illegal farce: Reuters 3. U.S. in tenuous sabre rattling over Ukraine: Russia Today 4. U.S. navy confirms missile destroyer USS Truxton approaching the Black Sea: Russia Today 5. Ukraine crisis and Olympics boost Vladimir Putin's popularity in Russia: The Guardian 6. Russia said to seek repeal of U.S. veto at IMF: Reuters 7. VTB Cancels New York Forum as U.S. Relations Sour: Bloomberg 8. London's lucrative Russia ties hang over sanctions debate: Reuters 9. Ukraine P.M., E.U. leaders taking soft line on Crimea: E.U. Observer
[The above stories are courtesy of Ulrike Marx and Roy Stephens]
The U.S. establishes strategic networks around globe, some linked to humanitarian organizations, and some to fascist organizations and individuals who will do their dirty work, Scott Rickard, former intelligence officer for the NSA, told RT.
Rickard, who also worked for the USAF and the Directorate of National Intelligence, believes that no doubt Yanukovich was very corrupt, and the uprising can’t of course be called peaceful, although it started out that way.
“When you are throwing thousands of Molotov cocktails and you are being funded – this is a very strategic network that these NGOs have and they have been operating in Ukraine for decades. These individuals have ties at the greatest levels into humanitarian organizations, all the way up to the best side of the things and all the way down into the fascist organizations for the individuals that will do dirty work for them,” Rickard said.
Rickard also argues that “the CIA has operated like this in South America, they have operated like this in Africa” and there is nothing surprising that “they are going to do this in Ukraine.”
This absolute must read commentary was posted on the Russia Today website early yesterday afternoon Moscow time---and it's another contribution to today's column from Roy Stephens.
Loss-making Chinese solar equipment producer Chaori Solar said it will not be able to meet interest payments on bonds due on Friday in what would be the country's first-ever domestic bond default, and possibly the first of many.
The warning by Shanghai Chaori Solar Energy Science and Technology Co Ltd highlights rising credit risk in China, where a massive run-up in corporate debt since 2008 - and overcapacity in sectors such as steel, coal and solar - have threatened the solvency of many borrowers.
A precedent-setting default, however, could benefit the economy in the long run by heralding the end of an era of risk-free credit in China, where local governments have often used public funds to rescue weak firms in order to prevent financial and social instability.
And so it begins again. This Reuters story, co-filed from Shanghai and Hong Kong, was posted on their website very early on Wednesday morning EST---and I thank Elliot Simon for sending it.
1. Art Cashin: "Tensions in Ukraine...and the Biggest Problem Washington Faces". 2. Keith Barron: "This is Going to Be a Huge Surprise For Investors in 2014". 3. Tom Fitzpatrick: "Look For Staggering $570 Surge in Gold and 44% Spike in Silver". 4. Bill Fleckenstein: "This is What's Going to Crater the Stock Market". 5. Richard Russell: "Damn the U.S. Lies, Bulls Hit and Propaganda".
[Please direct any questions or comments about what is said in these interviews by either Eric King or his guests, to them, and not to me. Thank you. - Ed]
Timothy Massad, the Treasury Department official named to head the U.S. Commodity Futures Trading Commission, said he would work to approve speculation limits in oil, natural gas and other commodities that have been resisted by banks and parts of the energy industry.
Massad and commission nominees Sharon Y. Bowen and J. Christopher Giancarlo told Senate Agriculture Committee lawmakers at a confirmation hearing today that they would look to review data and public comments on a current CFTC proposal to set limits on how large a position a trader can have in commodity markets.
“It is very important that we work to finalize that rule,” Massad, 57, said at the hearing in Washington. “They are a very important tool in the toolkit, and Congress obviously has directed us to take action in this regard. I will make that a priority.”
Where have we heard this line before? One wonders if he will be allowed to finally put a muzzle on JPMorgan et al's dealings in the Comex futures market in all four precious metals. I doubt it, but hope springs eternal. This Bloomberg story, filed from Washington, was posted on their website during the Denver lunch hour yesterday---and I found it embedded in a GATA release.
Odyssey Marine Exploration has been awarded the exclusive contract to conduct an archaeological excavation and recover the remaining valuable cargo from the SS Central America shipwreck located approximately 160 miles off the coast of South Carolina. The ship, which was immortalized in the best-selling book, "Ship of Gold in the Deep Blue Sea," sank in 1857 with one of the largest documented cargoes of gold ever lost at sea.
Odyssey was selected for the project by Ira Owen Kane, the court-appointed receiver who represents Recovery Limited Partnership (RLP) and Columbus Exploration (CE). Kane is charged by the court with overseeing the recovery project and has the benefit of a permanent injunction and exclusive salvage rights over the SS Central America shipwreck granted by the U.S. District Court for the Eastern Division of Virginia.
"We are excited about returning to the SS Central America and welcome the opportunity to work with Odyssey Marine Exploration on this historic undertaking. We are confident that Odyssey's unparalleled experience, superbly qualified personnel and state-of-the-art equipment will build on the successes of the first recovery effort, which has been characterized as a story of American initiative, ingenuity and determination," stated Kane.
This very interesting news item was posted on the maritime-executive.com Internet site yesterday---and it's anther story I found on the gata.org Internet site.
The U.S. Mint said it will resume selling its American Eagle platinum bullion coins on March 10, ending a four-year exit from the market, due to renewed interest from investors and dealers.
The U.S. Mint will offer the platinum bullion coins at a 4 percent premium over the spot price. Only 1-ounce coins will be sold, the Mint told authorized dealers in an email on Tuesday that was seen by Reuters.
Tom Jurkowsky, U.S. Mint's director of corporate communications, told Reuters the Mint notified its authorized purchasers about the platinum coin sales on Tuesday.
This Reuters piece showed up on the Chicago Tribune's website early Wednesday afternoon CST---and I thank Elliot Simon for his third and final offering in today's column.
GoldMoney founder and GATA consultant James Turk was interviewed at length on Wednesday by Erin Ade on Russia Today's "Boom/Bust" program, discussing gold's enduring function as money, the best money insofar as other forms are actually credit with counterparty risk. Central bank suppression of gold prices is mentioned as well.
The program has been posted at the youtube.com Internet site---and Turk's segment begins at the 6-minute mark. This is another item I found in a GATA release yesterday---and I thank Chris Powell for wordsmithing "all of the above."
Commodity prices are not just for buyers and sellers of the physical stuff. They are also the basis of derivative markets -- futures contracts, options, and combinations of these and other financial instruments -- which can be far larger. A twitch in the "benchmark" price can mean big shifts in the value of derivatives, and profits for the prescient.
People unhappy with the way the world gold market works suspect that more than prescience may be involved. In a class-action lawsuit filed this week, Kevin Maher, a New York-based investor in the gold and derivative markets, is suing the five banks which set the benchmark -- Deutsche, Barclays, Nova Scotia, Société Générale and HSBC -- for collusion. Those banks that have commented say they will defend the suit vigorously.
Another bit of bad news for the gold market comes from a forthcoming paper by Rosa Abrantes-Metz, of New York University's Stern School of Business, and her husband Albert Metz, a ratings-agency chief (writing in a personal capacity). This identifies a puzzling number of large downward price movements in the run-up to the afternoon "fix": a conference call, typically 10 minutes long, when the banks exchange information and decide on the price. Ms Abrantes-Metz terms the spikes "too frequent and too large" to be mere chance.
Chris Powell added that---"When a GATA delegation visited an editor for The Economist at his office in London in May 2009 to give him the gold price suppression story and the associated documentation, he couldn't get rid of us fast enough." This interesting commentary is headlined "Gold: In a fix, Mr. Bond"---and it's posted on the economist.com Internet site.
GATA's sometime lawyers, Berger & Montague in Philadelphia, a leading national antitrust law firm, are among those investigating complaints about the daily London gold price fixing, whose suppression of the gold price was documented by GATA's late board member Adrian Douglas in 2010.
If such a lawsuit ever got into what is called the discovery phase, the records of the banks might become subject to a court's review and eventually public, exposing the banks' transactions with the Western central banks that long have been underwriting the gold price suppression scheme.
Of course GATA supports such exposure and encourages gold traders and gold mining companies who feel harmed by gold price suppression generally and the London gold fix particularly to contact Berger & Montague's lead lawyer, GATA's friend Merrill Davidoff, to learn more about the firm's investigation. Presumably that investigation could lead to another federal anti-trust lawsuit for which plaintiffs would be needed.
This commentary by GATA's Chris Powell, plus all the appropriate links, was posted on the gata.org Internet site yesterday.
The power cuts that have been scheduled by South Africa's power utility Eskom to take effect over the next few days will have an adverse effect on production in the mining sector, industry insiders told Mineweb on Thursday.
Peter major, a mining consultant at Cadiz Corporate Solutions said load shedding by Eskom is paving the way for an increasingly difficult atmosphere between government and big mining houses that is critically reliant on consistent, uninterrupted electricity for their survival.
Earlier this morning, Eskom declared an emergency and asked key industrial customers to reduce load by 10% as from 08:00.
“Eskom calls on consumers to urgently switch off geysers, pool pumps and all non-essential appliances this morning to prevent the need for rotational load shedding. The power system is very tight. This risk has increased significantly due to the heavy rains over the last few days and an increase in technical problems experienced at some of Eskom's power stations,” the utility said in a statement.
This news item, filed from Johannesburg, was posted on the mineweb.com Internet site yesterday---and I thank Ulrike Marx for digging it up for us.
India’s current-account deficit narrowed to a fresh four-year low as gold imports cooled, offering a potential boost for the rupee even as economists said the gap may widen again if the economy improves.
The deficit was $4.2 billion in October through December, compared with $5.2 billion for the prior quarter, the Reserve Bank of India said in a statement in Mumbai yesterday. The shortfall was equivalent to 0.9 percent of gross domestic product. The current account is the broadest measure of trade, tracking goods, services and investment income.
The government increased taxes on gold imports in the world’s second-biggest user of the metal three times last year to help pare a trade imbalance that has weighed on the rupee. The currency has gained about 11 percent since reaching an all-time low on Aug. 28, the world’s best performer in that time, as imports have fallen and growth remains subdued.
“It has come down for all the wrong reasons -- if the economy picks up, imports will rise and you’ll see the current-account deficit go up again,” said Dharmakirti Joshi, chief economist with Mumbai-based Crisil Ltd. The government should start to withdraw restrictions on gold imports, he said.
Today's last story comes from Bloomberg. It was filed from New Delhi and posted on their website late on Wednesday evening MST---and I thank Ulrike Marx for her final offering in today's column.